The dominant dollar-pegged stablecoin, Tether (USDT), has achieved a historic market cap of $85.9 billion, surpassing competitors USDC and DAI. This milestone comes amidst intensifying discussions on US crypto regulation. The news was highlighted today during D.C. Fintech Week by Michael Barr, Vice Chair of the Federal Reserve.
Barr underscored the urgent need for comprehensive oversight of stablecoins, expressing concern over the unregulated proliferation of private money backed by US dollars. He stressed that the Federal Reserve has a vested interest in such regulatory affairs due to potential financial stability risks posed by these high-risk investments.
Furthermore, Barr pointed out that stablecoins are exploiting the trust of the Federal Reserve in their issuance process, necessitating rigorous regulation. His stance aligns with recent calls for swift implementation of crypto regulations by Wyoming Senator Cynthia Lummis.
On Tuesday, Barr had also emphasized the need for definitive regulation of stablecoins such as USDT at D.C. Fintech Week, citing concerns about entities "borrowing the trust of the Federal Reserve" and posing financial stability risks due to a lack of clear regulatory framework supervising such investments. His comments were in line with Senator Lummis’ demand for crypto regulations by early next year, following growing claims of SEC overreach.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.